Evaluating Ford (F) Stock's Actual Performance

• Ford's dividend output of 4.56% supports shareholder returns.

• The company's maturation and profits person mostly been disappointing.

• Investors looking to bargain the banal should see whether Ford is simply a high-quality business.

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Ford Motor Company (NYSE: F) is simply a well-known concern successful the car industry, having been astir since its founding successful 1903. The institution produces the highly palmy F-Series pickup trucks, which person been the best-selling vehicles successful the U.S. for 48 consecutive years. And it's a awesome of American industrialism.

However, this doesn't needfully mean the auto stock has worked retired to beryllium a worthwhile investment. Let's measure the show of Ford shares from antithetic clip horizons.

In the past 5 years, Ford produced a total return of 85% (as of Dec. 9). Shares were hammered aft the onset of the COVID-19 pandemic, truthful the betterment from a anemic starting constituent helped thrust the banal higher. Boosting Ford's returns is simply a hefty dividend yield of 4.56%. Management pays a quarterly dividend that presently amounts to $0.15. Income investors tin admit that.

The S&P 500 (SNPINDEX: ^GSPC) inactive fared better. In the past 5 years, the wide scale has generated a full instrumentality of 100%. The benchmark's outperformance during this clip skyline isn't eye-popping. But by zooming out, the quality is notable. The S&P 500's trailing-10-year full instrumentality of 298% crushes Ford's 65%.

For what it's worth, Ford has much than doubled the index's full instrumentality successful the past 12 months. The institution has won implicit investors with coagulated fiscal results, peculiarly successful Q3, erstwhile it bushed Wall Street's gross and net expectations.

It's wide that Ford shares tin person periods of marketplace outperformance. However, investors shouldn't instrumentality this arsenic a motion that this is simply a high-quality company. Investors should strive to ain a fantastic concern for the agelong term. There are cardinal factors that bespeak Ford doesn't autumn into this category.

Ford's maturation is weak, arsenic automotive gross climbed astatine a compound yearly complaint of conscionable 2.4% betwixt 2014 and 2024. That hardly keeps up with economical expansion.

Profits are disappointing; the operating margin averaged 2.5% successful the past 5 years. Ford is focused connected cutting costs, but it can't debar paying up for materials, labor, and manufacturing successful bid to stay applicable successful an highly competitory industry.